Oil prices stabilized today in international markets below $75, balancing between Saudi Arabia's estimates of strong Asian demand and a rise in US inventories.
In the London market, the price of a barrel after noon remained almost unchanged from yesterday's close of trade and stood at $74.45. It closed trading yesterday with a loss of $1.59.
There were no significant changes today in the US market, where a barrel was trading at $70,87. It closed yesterday down $1.67.
Traders were concerned yesterday by a build-up in US inventories as it signals weaker demand in the world's largest consumer.
Crude oil inventories rose by 8.7 million barrels last week and gasoline inventories by 2.2 million barrels, data from the Energy Department showed on Wednesday. Only distillate stocks such as heating oil fell, by 5.5 million barrels.
Demand could also be hampered by trade tensions between the US and China, as they will negatively impact economic growth, analysts warn.
The US imposed 10 percent tariffs on Chinese imports last weekend, and Beijing retaliated with taxes on imports of American oil, liquefied natural gas and coal. However, China's move is still moderate, as US refineries import relatively small amounts of oil.
Some tariffs could push up oil prices, but when all is said and done, they are likely to push them down because they could negatively impact the global economy and US President Donald Trump has indicated he is willing to offer exemptions for energy products to limit the impact on supply, BMI analysts explained.
On Thursday, Saudi Arabia stabilized markets by raising the official selling price of a barrel for March delivery to Asian buyers. The price will now be almost $4 higher than benchmarks in Oman and Dubai, amid strong demand in China and India and supply disruptions from Russia.
The Organization of the Petroleum Exporting Countries (OPEC) separately announced that a barrel of its members' basket of oil rose 27 cents to $77.17 on Wednesday.
